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Friday, January 25, 2013

Homebuyer grants available from bank settlement fund…

You may recall the big class action lawsuit that most states Attorneys General  joined into over illegal mortgage foreclosure practices (robo-signing and other shenanigans). That suit was settled in February of 2012 for $25 Billion. The states eventually divided up the settlement money and now Michigan has launched a grant program to use some of that money to provide help to first time homebuyers.

The grant program is being administered by the Michigan State Housing Development Authority – MSHDA.  This grant program should not be confused with the MSHDA Mortgage Assistance program that has long been available for low-income home buyers. It should also not be thought of as a loan in any way. It is not a loan. It is an outright grant of up to $3,000 that does not have to be repaid. It also differs from the Mortgage Assistance program that MISHDA runs because it has no earnings restrictions associated with getting a grant.

This grant program is not without some rules or guidelines. Here are a few things that apply:

·         The grants are aimed at First Time Homebuyers purchasing a single family home as their principal residence (note that for purposes of this program, people who have not owned a home within the last 3 years are considered to be first time buyers).

·         The grants are only available on purchases that involve a new mortgage (it does not have to be a MSHDA assisted mortgage, any type of mortgage will qualify but the sale cannot be a cash sale).

·         The grants must be processed through licensed mortgage brokers who are participating in the program. John Adams Mortgage Company is one such participating broker.

·         Non-military homebuyers may receive up to $3,000; while active duty and veteran homebuyers may receive up to $5,000.

·         There is no limit on the home sale price to which the grant may be applied.

·         There will be no cash given to the grantee. The funds must be applied towards the closing costs of the sale or may also be applied against the principal amount of the loan.

To read more about the program and view a FAQ document and the application go to my web site – www.themilfordteam.com and click on the MSHDA Grant Program choice.

This is an exciting program that should help get Michigan’s housing market with its recovery. The three year requirement to be eligible for a grant fits nicely into the timetable that many displaced people have been on while they re-built their credit after a foreclosure or short-sale. Download the documents and read through them or just give me a call (248-763-2497) or email and let’s discuss how to use this program to get you into a new home.

This program was funded to the tune of $35 Million for 2013 and about $8 Million has already been spent, so let’s find you a house and get your grant request in before summer when the money will likely run out.

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